What are Fixed-Income Securities

Assignment Task

Problem Set

I would like the entire problem set done in Excel.  Please set up each problem as if it were a small model.  That is, you should have separate input and calculation sections. I should be able to change the inputs and still get the correct answer.  Don’t hardcode any inputs.  Unfortunately, you will also have to type some tables of interest rates into Excel.  Everything should be well labeled and formatted appropriately.  For example, appropriate number formats, using blue font for hardcoded inputs etc.  Also, use text boxes and the equation editor to summarize all calculations.  Check the Insert ribbon.  You will find text boxes under shapes and the equation editor on the far right of the ribbon.

There are two separate parts to this assignment.  Part I consists of two problems taken from the back of the text’s chapters or based on examples from the text.  I have posted the solutions manual under content on D2L – so getting to the correct answer should not be an issue.   However, I want all the problems set up in Excel along with the problem solution set out in a text box.  This will obviously take some time, but it should make the midterm and final exam a snap.  Part II consists of a continuation of the lab problem from Problem Set #2.  This lab problem requires you to implement your model to estimate the parameters given the prices of 4 TIPS.

Text Problems

1. Chapter 4, Exercise #6.
2. Chapter 4, Exercise #8. When they ask you to find the Duration of the portfolio, they mean find the level and slope factor durations.

Lab Problem Part 3

There are actually two parts to this lab.  The first asks you to estimate the parameters of the Extended Nelson-Siegel model using 4 Treasury Inflation Protected Securities (TIPS).   The second then asks you to insert a Button on the spreadsheet to run the optimization problem automatically (i.e. call Solver using VBA).  Refer to the Excel file: “Problem Set #3 – Start – Version 2.xlsm”.  Note, that this file has my version of the Rcc and NSSBP functions already set up in a module.

This Accounting and Finance has been solved by our PhD Experts at My Uni Paper.